UNENFORCEABLE CONTRACTS (Art.

1403-1408)

Unenforceable contracts cannot be enforced by a proper action, unless ratified;

Classes:

1. Contracts entered into without or in excess of authority (Art. 1403, No.1) or; there is absolutely no
consent.

- Applicable principles:
no one may contract in the name of another without being authorized by the latter or unless he
has right to represent him. If he is duly authorized, he must act within the scope of his powers.
such contracts are unenforceable as reiterated in the law on agency
such contract may be ratified by the person in whose behalf it has been executed, before it is
revoked by the other contracting party

NOTE:
***Confirmation and ratification were not use interchangeably in the old law, but in the new law, the term
ratification is now used to designate the act of validating any kind of defective contract. Recognition, on
the other hand, is merely to cure a defect of proof.

2. contracts which do not comply with the statute of frauds (Art. 1403, No. 2)
there is no writing, note, or memorandum by which the contract may be proved
Statute of Frauds was enacted for the purpose of preventing frauds
such statute states that evidence of the agreement cannot be received without the writing or a
secondary evidence of its contents
statute simply provides the method by which the contracts enumerated therein may be proved.
Effect: no action can be enforced unless the requirement that the contract be in writing be
complied with.
Form required is for evidentiary purpose
Statute of Frauds is applicable only to those contacts which are purely executory and not to those
which have been consummated either totally orpartially. (Case: Carbonnel vs Poncio)
et al.; Inigo vs Estate of Maloto)

6 contracts covered :
1. An agreement that by its terms is not to be performed within a year from the making thereof;
- limit of human memory is 1 year
- if one of the contracting parties has already complied with the obligations imposed upon him by said
contract within the year, the other party cannot invoke the Statute of Fraud.

2. A special promise to answer for the debt, default, or miscarriage of another;

-such promise must be collateral, not independent or original for Statute of Frauds to apply.

3.An agreement made in consideration of marriage, other than a mutual promise to marry;
-marriage settlements and donations propter nuptias are covered by the statute of fraud

4. An agreement for the sale of goods, chattels or things in action, at a price not less than five hundred
pesos
-loan is not covered, provision applies only to SALE of goods, if the transaction involves inseparable
goods, the prices of the items shall be considered as a whole
-if the transaction separable goods, the prices of the items shall not be less than P500

5. An agreement for the leasing for a longer period than one year, or for the sale of real property or of an
interest therein;
- oral agreement to extend the lease is covered by the Statute.

6. A representation as to the credit of a third person.

- Quasi-delict
-misrepresentation by a 3rd person will make him liable only if he has signed a document in representing
the credit of another person.

NOTE
-These contracts are susceptible to ratification.
-by the failure to object to the presentation of oral evidence to prove the same
- by the acceptance of the benefits under them.

3. Contracts where both the contracting parties do not possess the required legal capacity.
Absolutely vitiated consent.
If only one party is incapacitated, the contract is voidable.
May be ratified by the parents or guardians of the incapacitated persons, in effect, the contract
becomes voidable.
If ratified by the parties themselves after gaining the capacity, the contract shall be validated from
its inception.

Characteristics of unenforceable contracts

cannot be enforced by proper action
susceptible of ratification
cannot be assailed by 3rd persons